Correlation Between ANZ Group and Barclays PLC
Can any of the company-specific risk be diversified away by investing in both ANZ Group and Barclays PLC at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining ANZ Group and Barclays PLC into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between ANZ Group Holdings and Barclays PLC ADR, you can compare the effects of market volatilities on ANZ Group and Barclays PLC and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in ANZ Group with a short position of Barclays PLC. Check out your portfolio center. Please also check ongoing floating volatility patterns of ANZ Group and Barclays PLC.
Diversification Opportunities for ANZ Group and Barclays PLC
-0.24 | Correlation Coefficient |
Very good diversification
The 3 months correlation between ANZ and Barclays is -0.24. Overlapping area represents the amount of risk that can be diversified away by holding ANZ Group Holdings and Barclays PLC ADR in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Barclays PLC ADR and ANZ Group is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on ANZ Group Holdings are associated (or correlated) with Barclays PLC. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Barclays PLC ADR has no effect on the direction of ANZ Group i.e., ANZ Group and Barclays PLC go up and down completely randomly.
Pair Corralation between ANZ Group and Barclays PLC
Assuming the 90 days horizon ANZ Group Holdings is expected to generate 1.83 times more return on investment than Barclays PLC. However, ANZ Group is 1.83 times more volatile than Barclays PLC ADR. It trades about 0.06 of its potential returns per unit of risk. Barclays PLC ADR is currently generating about 0.07 per unit of risk. If you would invest 1,539 in ANZ Group Holdings on September 3, 2024 and sell it today you would earn a total of 99.00 from holding ANZ Group Holdings or generate 6.43% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 8.48% |
| Values | Daily Returns |
ANZ Group Holdings vs. Barclays PLC ADR
Performance |
| Timeline |
| ANZ Group Holdings |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
| Barclays PLC ADR |
ANZ Group and Barclays PLC Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with ANZ Group and Barclays PLC
The main advantage of trading using opposite ANZ Group and Barclays PLC positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if ANZ Group position performs unexpectedly, Barclays PLC can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Barclays PLC will offset losses from the drop in Barclays PLC's long position.| ANZ Group vs. Playa Hotels Resorts | ANZ Group vs. Hasbro Inc | ANZ Group vs. Canlan Ice Sports | ANZ Group vs. Starbucks |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the ETF Categories module to list of ETF categories grouped based on various criteria, such as the investment strategy or type of investments.
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